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Starbucks management style
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Introduction to Starbucks and its strategy
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Starbucks Corporation.
Natasha Sedminik
MGMT 3001
Management Concepts & Practice
University of Louisiana at Monroe
Monroe, Louisiana
Dr. Strickler
April 6, 2014
Introduction
The first Starbucks opened in Seattle, Washington in 1971 by two teachers and a writer. Their names were Jerry Baldwin, Zev Siegl, and Gordon Bowker. With more than “20,100 locations worldwide and 11,500 locations all over the United States,” it is no surprise that the company is doing so well (Huffington Post, 2014). Also, according to Fortune’s 100 best companies to work for, Starbucks was ranked number 94 out of 100, compared to its previous ranking of 73 (Starbucks, 2013). Being a huge Starbucks supporter, it seemed like the perfect company to research. This paper will discuss five major topics concerning Starbucks motivational principles, the importance of business ethics, how diversity is implemented into the company, new innovations that are going to be put into place soon, and the Starbucks SWOT analysis.
Starbucks Motivational Principles
Motivation is important when it comes to having and producing effective employees. The two main theories Starbucks uses to motivate employees are: ERG theory and equity theory. It was interesting to see that one method of motivating employees was based off of the ERG theory that was developed by Clayton Alderfer. The ERG theory “assumes that three basic needs influence behavior-existence, relatedness, and growth” (Kinicki & Williams, 2011). Growth needs are important to pay attention to in order to motivate employees to work effectively (Cada, 2012). Starbucks offers on the job training and education that includes: education of coffee, learning to lead, and business and communication sk...
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...order from a mobile payment application on a cell phone (Robertson, 2014). With the way technology has been advancing over the years, it is no surprise that Starbucks offers such an app to pay with a prepaid Starbucks Card from a smartphone (Robertson, 2014). By creating this new smartphone app it will increase the company’s productivity levels.
Starbucks SWOT Analysis
Conclusion
In conclusion, Starbucks Corporation offers many great examples of what a company can do to be successful, not only with employees but for the business too. In this paper five major topics were discussed, which include: the motivational principles displayed by Starbucks, the importance of business ethics, how diversity is implemented throughout the company, and the new innovations that being put into place. All of these topics are important when trying to run a successful company.
Strives to be the leader in micro brewing while maintaining the core values it started with and had employee buy in even before it went” 100 % employee owned in2013” (Gorski, 2013).
Whole Foods Market Inc. is a service provider in the grocery industry, which report in the US economy under the North American Industry Classification System NAICS 42441, General-line groceries merchants wholesalers, by the time the company started operations in 1980 supermarkets had a history of 51 years. Supermarkets unlike other type of retail is considered truly American in origin, self service grocery stores are traced back to 1912 in Memphis Tennessee, and it was in 1930 when Michael Cullen opened the first store of the King Kullen supermarket chain, it was around that time after the big depression that the independent stores which at that time only offered dry groceries started to transition to the supermarket model, including groceries, produce, and
Whole Food’s major competition is Trader Joe’s, Central Market/HEB, and Sprouts. Each of these stores has branched into the specialty food industry, at least in some aspect of their company. The main competitor is Sprouts, followed by Trader Joe’s (CITE investopedia).
Internal resource is the first consideration that can lead to sustainable competitive advantage and Resource –Based View (RBV) is a theory that usefully helps a firm focus on internal resources (Kraaijenbrink, Spender & Aard, 2010). According to RBV (Valuable, Rare, hard to imitate and non-substitutable), companies have different tangible and intangible resources, these resources can be transformed into unique ability, this special ability cannot flow between firms and rival firms and difficult to reproduce. These unique resources and abilities are the source of enterprise sustainable competitive advantage. In this part, Starbucks and Apple are worth to be analyzed by RBV.
The basis of Starbucks’ operations and policies is to connect with the staff so that they can better the organizational
As of late, Costco has been opening around 30 new distribution centres every year, in this way developing square footage by 4% to 5% every year. It is additionally chipping away at a noteworthy IT modernization undertaking to make its stores more productive and to develop e-trade. Basically, in 2015 Costco opened 23 new stores in North America and abroad, generating record revenues of 100 million dollars for each new warehouses.
In addition to being best-known supplier of the finest coffee and promising only the highest quality products, Starbucks emphasizes firm values, provides guidelines to enhance employee self-esteem. This is to ensure continued customer satisfaction. Moreover, diversity has become a priority to providing an inviting environment to all consumers. Starbucks continues to abide by a strict, slow growth policy in which they set out to dominate a market before moving on to expand, thus history has shown this strategy to be successful for Starbucks, making them one the fastest growing companies nationwide.
Schultz, Howard, and Joanne Gordon. Onward: How Starbucks Fought for Its Life Without Losing Its Soul. New York: Rodale, 2011. N. pag. Print.
...m of discrimination and promote equal opportunity in all sectors of Starbucks business transactions. We will set down with leadership and emphasize the importance of honesty, integrity and the reason it flow's so diligently through this corporation. Our company doesn't subscribe to dishonest practices, such as corruption or fraudulent business dealings. We must hold our selves to the same standards that we hold our employees. Understand that diversity in all aspects of our company's daily ventures creates a worldly image and increases ability to fulfill our goal of opening 40'000 Starbucks with half being outside the US.
Visit Starbucks.com and you enter a virtual world of delight. Consumers can “sample” over 30 blends of coffee; find Starbucks coffeehouse locations, or learn about Starbucks Hear Music®, where customers can “burn personalized CDs, use listening stations to explore musical recommendations, enjoy a handcrafted Starbucks® beverage, or surf the web at (a) T-Mobile Wi-Fi enabled coffee bar” (Starbucks, 2008). Starbucks uses their website to communicate with their consumers about their company’s mission, social responsibility, business ethnic and compliance, diversity relations and press releases. Consumers can even read about the latest “rumor responses” that Starbucks wants to clarify about misinformation regarding the company. From the “click” of a button you can shop for Starbucks merchandise or check the balance on your Starbucks Card, the Starbucks website has got their customers needs in mind.
For this organizational analysis, I decided to analyze Starbucks. I chose Starbucks because they are the leading innovators in socially impactful business activities and personally, I love Starbucks coffee! Obviously, the point of this paper is not to talk about how good their products are, but to analyze how their organization is structured and identify potential for improvement. I have never worked at a Starbucks, but I have two friends that work at the location inside of Hy-Vee in Cedar Falls. After countless hours of research, talking to my friends about day-to-day activities, and actually going to Starbucks on numerous occasions over the past few years, I knew this was the organization that I would love to analyze.
With clear core values towards providing quality coffee, the best service, and atmosphere, Starbucks has enjoyed great success since it was founded 30 years ago. The company has being doing very well for last 11 years with 5% or more store sales increase, even with the rest economy still reeling from the post-9/11 recession. However recent research, conducted to Starbucks, have showed some concerns regarding company’s problem meeting customers’ expectations.
One of Baskin-Robbins’ largest divisions is in Japan according to their 2014 annual report. Baskin Robbins’ key markets a mainly in Asia and the Middle East region. In Japan, there are 1,170 restaurants that has been last accounted for in 2014. The restaurants in Japan has a total sales report of 20%. Baskin-Robbins does business in Japan through a 4.3% ownership in a Baskin Robbins brand joint venture. Before describing the benefits of having a comparative advantage in Japan, understanding the meaning can help explain it in further detail. Comparative advantage is what is known as the “foundation concept of international trade”, it refers to the superior features and unique benefits it has in global competition.
Introduction This paper will provide an argument for diversification to be presented to the board of directors for Starbucks. A strategy for diversification indicating the products and industries for diversification and how synergies may be gained. The identification and the discussion of the foreign market Starbucks should enter will be presented, along with the strategy it should use to enter the market. Challenges Starbucks may face in the foreign market will be discussed, as well as how it might respond strategically to minimize the impact of these challenges. Also, this paper will encompass a scenario when it would not make sense for Starbucks to diversify or expand into a foreign market, and how the company will create a business environment conducive to ethical behavior will be assessed.
Everything centers on the organizational culture within Starbucks. While being a customer service-based company and understanding that the customer satisfaction and loyalty are what will make the company profitable, Starbucks takes a different approach to customer service than other companies. By hiring employees that fit in the organizational culture (ICFAI, 2005) and treating their employees well (Lefevere, n.d.), Starbucks brings in and retains customers through their happy employees. The qualities that Starbucks hires for are "adaptability, dependability and the ability to work in a team" (ICFAI, 2005). The culture is supportive and laid back (Montana, 2005). Howard Shultz, Starbucks president and CEO, has the theory "that if you treat your employees well, they will treat your customers well" (Starbucks, 1997).